Bitcoin Peers Network and the Inefficiency of Blockchain

(Submitted on 5 Apr 2017)

Abstract: We investigate Bitcoin network monitoring the dynamics of blocks and
transactions.
We unveil that 43% of the transactions are still not included in
the Blockchain after 1h from the first time they were seen in the network and
20% of the transactions are still not included in the Blockchain after 30
days, revealing therefore great inefficiency in the Bitcoin system.
However, we
observe that most of these `forgotten’ transactions have low values and in
terms of transferred value the system is less inefficient with 93% of the
transactions value being included into the Blockchain within 3h.
The fact that
a sizeable fraction of transactions is not processed timely casts serious
doubts on the usability of the Bitcoin Blockchain for reliable time-stamping
purposes and calls for a debate about the right systems of incentives which a
peer-to-peer unintermediated system should introduce to promote efficient
transaction recording.
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